Industry Insights

The Toys R Us Reboot

When Toys R Us filed for bankruptcy and closed the last of its 800 U.S. stores last year, a 70-year stateside run came to an end. Overseas, stores in the UK and Australia were also shuttered. But another 800 stores, in Europe, Asia and India, remained open. The Toys R Us brand still has value in the global toy industry, and in the U.S., it has former executives who want to stage a comeback in time for the 2019 holiday shopping season.

Taking the lead is Richard Barry, former Global Chief Merchandising Officer of Toys R Us. Barry was with the toy retailer for more than 30 years, and has no intention of leaving the category upon which he built a career. He and several other retail executives from Toys R Us founded Tru Kids dba Tru Kids Brands, now the parent company of Toys R Us, Babies R Us, Geoffrey the Giraffe, and over 20 toy and baby brands. Barry is President and CEO. On February 11, Tru Kids announced that Toys R Us “has officially emerged as a new company, with new leadership and a new vision”.

Details regarding what form a new Toys R Us might take in the U.S. market are still being worked out. Barry said that he and his team are exploring various options for a comeback, including free-standing stores and shops within other stores, the New York Times reports. “We have a once-in-a-lifetime opportunity to write the next chapter of Toys R Us by launching a newly imagined omni-channel retail experience for our beloved brands here in the U.S.,” Barry said in a statement.

Barry has also said that ecommerce will play a central role. A failure of the one-time toy industry giant to fully invest in ecommerce and adapt to consumers’ shift to online shopping is often cited as a factor in the downfall of Toys R Us. The troubled retailer was also mired in debt, and faced formidable competition from the likes of Amazon, Walmart and Target.

Tru Kids estimates that despite the success of such rivals, 40% to 50% of Toys R Us market share is still up for grabs. In broad terms, the new company will focus on the customer experience in physical stores, which will be much smaller – about 10,000 square feet versus 40,000 square feet – than the original Toys R Us stores.